A new report out this morning says Facebook's doing just fine with mobile ads--finer, in fact, than Twitter (see update below). According to the report from TBG Digital, which helps marketers place ads on Facebook and Twitter, ads that appear in people's Facebook news feeds on their mobile devices get four times as many clicks as similar but not identical Twitter ads.
Update: While Facebook's improving ad results speak for themselves, TBG has since backpedaled on its conclusion that Facebook mobile newsfeed ads perform better than directly comparable Twitter mobile ads. It turns out that TBG was comparing Twitter's Promoted Account ads, which do not appear directly in users' newsfeed streams, to Facebook's newsfeed ads. The proper comparison would have been Twitter's Promoted Tweet ads.
On the latter, Twitter says its click-through rate ranges from 1% to 3%--which is comparable to or even better than Facebook's. TBG is not releasing its own data on click-through rates for Twitter's Promoted Tweets, but TBG CEO Simon Mansell notes that the two companies' ads that it was comparing are both aimed at generating new fans for brands, so the comparison remains valid on that score.
Facebook's click-through rate, at least measured on 278 million ad impressions TBG recorded in June, is still only 1.14%, though that's better than most display ads. Twitter's click-through rate in a separate recent TBG study of 24 million Twitter ad impressions (for Promoted Accounts, not Promoted Tweets), by contrast, was only 0.266%--though that is in turn far better than Facebook's desktop ads overall, which have a dismal click-through rate of just 0.083%.
The reason both Twitter's and Facebook's mobile ads work better than on the desktop, says Mansell, is pretty simple: "People's eyes naturally avoid ads," he says. "In the stream, you can't avoid them."
There are several likely reasons why Facebook's apparently superior mobile ads seem to be working, says Mansell:
* They're new, and people tend to click more often initially on new ad types, either because they're curious or because they don't quite realize they're ads. Some chunk of those clicks will disappear over time, Mansell says.
* Facebook's feeds contain relatively more posts from friends vs. the people you're simply following on Twitter, so you're more likely to pay attention to most of what appears in your Facebook newsfeed. That's partly because Facebook's EdgeRank algorithm is more selective about what gets into your newsfeed, while Twitter's basically a firehose you know you can't keep up with, so you skip past a lot of posts.
* Facebook's mobile newsfeed ads are actually Sponsored Stories, or ads with an endorsement from a friend. People click on those ads a lot more often than non-social ads. Indeed, TBG's report also shows that Sponsored Stories have a 53% higher click-through rate than standard non-social Facebook ads--even more than it found in a study last year.
* Facebook's mobile ads can be demographically targeted. (Update: Twitter just announced on July 19 that it's starting to offer brands the ability to send more tweets to more targeted audiences, so that distinction may narrow.)
* Facebook is careful about not showing the same ad too many times, Mansell says.
Overall, CPM rates for Facebook ads, desktop and mobile, have jumped 58% from a year ago. That's thanks to the greater effectiveness of Sponsored Stories and mobile ads in particular.
